When news broke in late September that Saudi Arabia’s stock exmodify was considering reshifting limits on foreign ownership of listed companies by the finish of the year, the market surged, assisting to erase losses that had built the Tadawul All-Share Index (TASI) one of the world’s lowest-performing stock markets in 2025. Although there have been no notable examples of foreign investors reaching the current cap of 49 percent, the rumored modify signals that Saudi Arabia is seeking greater foreign investment to meet its Vision 2030 goals.
This year, the price of a barrel of oil has fallen from a high of around $78 in mid-January to below $60 in mid-October. According to the International Monetary Fund, the Saudi government requireds a breakeven price of around $96 per barrel to balance its budobtain. To achieve its Vision 2030 tarobtains, including capitalizing the Public Investment Fund (PIF, the kingdom’s sovereign wealth fund), that price rises to $111 per barrel.
Raising the cap, combined with additional policy modifys and lower global interest rates, could increase capital inflows and assist the Saudi government reach its 2030 tarobtain of attracting $100 billion in foreign direct investment (FDI).
If the kingdom does indeed lift ownership caps, it will not be alone. In June 2020, the UAE scrapped the requirement that a foreign investor have an Emirati partner when opening a company. Similarly, Qatar launched shifting to allow 100 percent foreign ownership of businesses in 2019—although both countries exclude strategic industries like security, energy, telecommunications and insurance from full foreign ownership.
Reports that Riyadh will create a similar shift reflect its quest to attract more portfolio investment, open its markets and integrate them with the global economy. Foreign investment inflows could assist offset budobtain shortfalls should oil prices remain low.
A Gradual Opening
Riyadh’s latest signals are hardly a surprise, following a string of earlier shifts to open the Saudi economy to foreign investment. In 2015, regulators opened the stock market to Qualified Foreign Investors, defined as financial institutions with a minimum $5 billion in assets under management. Since 2016, the counattempt has allowed 100 percent foreign ownership in certain companies, such as in the manufacturing, retail and wholesale sectors. In 2017, the kingdom required companies listed on the TASI to apply international reporting standards, which increased transparency via financial audits and aligned the exmodify’s systems with global benchmarks.
Since that year, policycreaters have reformed corporate governance regulations and listing requirements; created Nomu, a parallel exmodify for compact and medium enterprises; and allowed non-resident foreigners to subscribe to initial public offerings (IPOs). Saudi regulators have worked with S&P Dow Jones, FTSE and MSCI to include Saudi stocks in their indices. In 2019, the counattempt streamlined business licensing under the “Invest Saudi” scheme.
Saudi Arabia’s economic reforms, aggressive government investment and alignment with global standards has led to billions of dollars in passive inflows. This culminated in the historic IPO of state oil giant Saudi Aramco in 2019, which raised around $25 billion and set a $1.7 trillion valuation. Riyadh applyd the capital to fund Vision 2030.
Despite these shifts, global economic indicators point to subpar growth and lower oil prices ahead, constraining Saudi Arabia’s ability to fund Vision 2030. Geopolitical tensions, such as the Israel-Iran war in June 2025 or attacks by Yemen’s Houthis on vital shipping routes, could create further price volatility and erode fiscal revenues. A fall in oil proceeds has prompted Saudi Arabia to resort to international capital markets to plug a $68 billion budobtain deficit. This in turn has signaled uncertainty and resulted in poor performance on the TASI, building the exmodify an outlier in the region; Kuwait’s energy-depfinishent exmodify has grown by 17 percent since the start of the year, and Dubai’s exmodify, which is less depfinishent on oil, is up 20 percent.
This context provides Saudi Arabia with more reasons to open its markets and attract foreign investment. Such shifts would also give it space to continue private-sector job creation for its youthful population and to bring in outside expertise to address skills gaps. Regulatory and economic reforms have already boosted female labor force participation, reduced unemployment and supported private sector job growth. According to Saudi Arabia’s Vice Minister of Communications and Information Technology Eng. Haitham AlOhali between 2017 and 2024 women’s representation in information and communication technology (ICT) rose from seven to 35 percent. To hire new Saudi workers entering the labor market, the counattempt requireds to create 920,000 new jobs by 2030. To that finish, Vision 2030 aims to create a highly skilled workforce to enter both established fields—like engineering, healthcare or ICT—and emerging fields such as artificial ininformigence (AI) and climate technology.
Saudi investment in the latter has lagged due to a regional skills shortage and investor demand for rapid returns. To remedy this, in 2021 the government pledged to invest $187 billion by 2030 to boost job creation in the sector and to tarobtain net-zero emissions. So far, Vision 2030 reforms have increased non-oil economic activity to 52 percent of total GDP in 2024, likely to rise to 57 percent this year.
Following the Opportunities
Greater opening of Saudi markets will likely benefit the mining, healthcare, construction and real estate, insurance, ICT and power generation sectors. The Saudi government plans to roll out mandatory government health insurance for all citizens in 2026. Combined with efforts to increase vehicle insurance coverage, this will boost demand for insurance products. Robust demand for residential hoapplying by young working Saudis, combined with Vision 2030-funded infrastructure projects, will continue to drive growth in the construction sector, while hoapplying purchases will also stimulate growth in the mortgage market.
Saudi Arabia has been deploying PIF funding to secure its place in new sectors such as green energy, hydrogen, electric vehicles and AI. To shift to 50 percent renewable energy in its electricity mix by 2030, S&P estimates that Saudi Arabia requireds to add 90 gigawatts (GW) of renewable energy and 48 gigawatt-hours of storage capacity. The PIF and a consortium of Saudi utilities signed an $8.3 billion agreement in July to develop 15 GW of renewable energy, raising the kingdom’s total contracted renewables production to 43 GW. Saudi Arabia is also funding a green hydrogen project at NEOM—a planned-city megaproject that is a hallmark of Vision 2030.
The Saudi digital infrastructure sector also provides investment opportunities. Saudi Arabia attracted $20 billion in investment to expand data center capacity to 2 GW by 2030, displaycased by its DataVolt partnering with Supermicro to build a net-zero AI campus in NEOM.
The Saudi technology sector is already attracting foreign investment. China’s Lenovo is building a computer and server assembly factory in the counattempt. Dell and HP are scouting factory sites as they explore expansion there, while Saudi firm Alat is partnering with Japan’s SoftBank Group to manufacture industrial robots. The kingdom has also been working to attract both China’s Foxconn, which assembles products for Apple, and Taiwan’s Quanta, which creates computers and components for Dell. Saudi Arabia’s mining sector, valued at $2.5 trillion, is another growing sector. Riyadh plans to increase investment in mining activities from $17 billion in 2024 to $75 billion by 2030. Finally, PIF has invested in developing a domestic auto indusattempt, neobtainediated collaborations with Foxconn and Hyundai, and bought a majority stake in Lucid, a California-based EV company.
Vision 2030 has already diversified the Saudi economy, but the share of non-oil exports in the counattempt’s gross domestic product remains below tarobtain in its quest to generate 65 percent of GDP from the non-oil private sector by 2030. Lifting the foreign ownership cap on Saudi companies would signal to foreign investors that Saudi Arabia wants to further open its markets to achieve its economic goals. As the kingdom welcomes more foreign investment and imposes greater fiscal discipline in 2026, the large test for the implementation of Vision 2030 will be how it pivots from state-led economic development to a market-led economy. Attracting foreign investment into Saudi Arabia’s non-oil sectors could play an important role in supporting non-oil economic growth and job creation.
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